A group that pocketed about 9.3 billion won in illicit gains through front-running—buying shares in advance and then inflating prices with "featured stock" articles—has been brought to trial.
The Financial Investigation Division 2 of the Seoul Southern District Prosecutors' Office said on the 29th that it indicted eight people, including one certified public accountant and six current and former reporters at an economic newspaper, on charges including violating the Financial Investment Services and Capital Markets Act. (Director General Kim Tae-gyeom)
Seven people, including A, a certified public accountant and head of a pseudo-investment advisory firm, were found to have made unfair gains totaling about 8.55 billion won by using more than 1,800 featured stock articles over approximately four years and eight months from Oct. 2020 to June last year.
A was found to have sequentially recruited incumbent reporters on the condition of paying 300,000 won per article, and some reporters were found to have brought in other reporters. A was also found to have handed over about 150 million won, about 160 million won, and about 28 million won, respectively, to three reporters in return for distributing articles.
Separately, Reporter B is accused of exploiting the ability to transmit featured stock articles directly by buying the relevant stock before a featured stock article he wrote was published and then selling it again if the price rose. B was found to have pocketed about 740 million won in illicit gains by using a total of 340 articles from Oct. 2022 to July 2024 with this method.
Prosecutors said, "We will do our utmost to maintain the indictment so the defendants can receive punishment commensurate with their crimes and will track and strip the criminal revenue to the end," adding, "We will respond firmly to behavior that disrupts the stock market and do our best for the 'normalization of the abnormal.'"